Something big is happening in the world of Russian power. And it ain't pretty.

Two weeks ago, Viktor Cherkesov, the don of one of the main siloviki clans, published an open letter in Kommersant. Reports in the English-language press focused on how unusual it was for a silovik to take his problems public in the Putin Era--particularly a silovik of Cherkesov's stature. As head of the Federal Anti-Narcotics Agency, Cherkesov essentially runs a kind of FSB-2. And given the recent slew of high-profile arrests, along with Cherkesov's open letter, it looks as though FSB-2 is at war with FSB-1.

It's fitting that this war comes exactly 10 years after the outbreak of the Banker's War under Yeltsin, when the oligarchs divided into two mortal enemy camps in the fight over the last of Russia's unprivatized spoils. On one side of the Banker's War were Boris Berezovsky and Vladimir Gusinsky; and on the other side, the "baby billionaire" (to use the Washington Post's Fred Hiatt's own words) Vladimir Potanin and his men-in-power, the so-called "young reformers" headed by Anatoly Chubais, Boris Nemtsov, and Alexander Kokh. When the Berezovsky-Gusinsky clan felt cheated out of the privatization of Russia's telecommunications giant Svyazinvest, they took their war to the media, which they largely controlled through television stations ORT and NTV, as well as to the Russian security services, which they used to drudge up damaging kompromat. The end result of the Banker's War was the end of the oligarchy itself. Within a year of their feud, they and the system that made them collapsed.

Cherkesov warned in his letter that this very same suicidal scenario is playing out all over again today: as we near the end of the halcyon Putin Era, the once seemingly monolithic siloviki have divided into two warring camps struggling over power and assets. In one camp is the Cherkesov Clan, FSB-2; in the other, the clan headed by the FSB chief Nikolai Patrushev and his Kremlin allies led by the Presidential Administration deputy and Rosneft chief Igor Sechin. "We must not allow scandals and infighting," Cherkesov wrote in Kommersant. "There can be no winners in this war... There is too much at stake." He argued that not only would both clans lose, but the system built up in Putin's reign, the "corporatism" which Cherkesov argued has saved Russia from chaos, would go down with it.

If the "corporatist" system collapses, then it's back to chaos, just as the Banker's War ended in 1998 with the financial collapse and end of "liberal reforms."

First, a little background. Viktor Cherkesov is an old Putin ally. He headed the FSB in St. Petersburg in the 1990s, when Putin was the deputy mayor. After Putin came to power in 2000, he named Cherkesov as the Kremlin envoy for Russia's northwest region (which includes Petersburg), making Cherkesov one of seven regional envoys whose job was to bring the Russian Federation back under Kremlin control in the "vertikalnaya vlast" or vertical power scheme. In the spring of 2003, Cherkesov was brought back to Moscow to head the newly formed Federal Anti-Narcotics Agency.

The name of the structure is misleading. The Anti-Narcotics Agency was really turned into a second FSB, having absorbed the personnel and equipment and assets of the massive, all-powerful Tax Police, with an estimated 40,000 employees. It was set up as a kind of Russian FBI, tasked to fight economic and organized crime as well as drug trafficking.

Putin's massive reorganization of the security ministries in March 2003 was misunderstood at the time. It was either scoffed at or, oddly enough, praised by liberals like Irina Khakamada and Grigory Yavlinsky, who "supported the changes as a step toward efficiency and a sign that Putin is making the drug problem a priority," according to the Moscow Times.

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